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ST. JOSEPH'S HOSPITAL (SAVANNAH, GA.) 1993 BONDS RATED 'A-' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, March 19 /PRNewswire/ -- The Hospital Authority of Savannah, Ga., $45 million revenue bonds (Saint Joseph's Hospital Project), Series 1993 are rated 'A-' by Fitch. The credit trend is stable. The issue is expected to be priced through negotiation by Merrill Lynch & Co. during the week of March 22. Bond proceeds primarily will be used to refund $11.5 million of outstanding debt, finance various renovations and equipment purchases, and fund a debt service reserve fund.
 The rating is supported by Saint Joseph's Hospital's historically strong financial operating performance, solid debt service coverage ratios, manageable debt load, and well balanced payor mix. Concerns include the competitive service area and the need to improve upon physician-management relationships.
 Saint Joseph's currently operates 279 beds. Admissions dropped a moderate 4.2 percent from 1988 through 1992 while the average length of stay was reduced favorably to 5.9 days from 6.8.
 Operating margins exceeded 5 percent in four of the last five years. Historical pro forma maximum annual debt service (MADS) coverage was a strong 3.3 times (x) in 1992 and was greater than 2x in each of the last five years. The debt load is moderate, with pro forma debt-to- capitalization of 52 percent and MADS as a percent of revenues of only 4.4 percent. The cash position dipped to $4.8 million as of Dec. 31. However, liquidity will improve since this bond issue will reimburse the hospital for approximately $3 million of prior expenditures. Furthermore, bond proceeds will be used to fund routine capital expenditures for the next two years, allowing Saint Joseph's to build its cash position. The payor mix is well balanced, with over 54 percent of its revenues coming from commercial payors. Managed care providers account for a low 3 percent of revenues.
 The competitive service area is a concern. Saint Joseph's is the third of three hospitals in terms of market share. However, Saint Joseph's is located to take advantage of any future growth that may occur in the area. Physician offices are in general more conveniently located nearer the other two facilities in Savannah. Sensitivity to medical staff needs and continual facility upgrading are key factors for Saint Joseph's to maintain and improve its market share.
 -0- 3/19/93
 /CONTACT: Michele Cebron of Fitch, 212-908-0591/


CO: Hospital Authority of Savannah, Georgia ST: Georgia IN: HEA SU: RTG

KD -- NY064 -- 8035 03/19/93 16:45 EST
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Date:Mar 19, 1993
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